Using technology to bank AfricaLessons.pptVIP

7 December 2004 Topics A look at GSM and why it’s so successful in Africa Technologies typically available for mobile banking Typical business models for mobile banking A quick look at banking in Africa Mobile banking in Africa Other barriers to rolling out a successful solution Our lessons Excuse me while I take my foot out of my mouth… “Everything that can be invented has been invented.” Charles H. Duell, Commissioner, U.S. Patent Office, 1899 “The wireless music box has no imaginable commercial value. Who would pay for a message sent to nobody in particular?” David Sarnoff’s associates in response to his urgings for investment in the radio in the 1920’s “This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us.” Western Union, internal memo, 1876 …and put the other one in Vodacoms initial growth projections catered for 250,000 subscribers within ten years. Vodacom’s initial projections for the number of prepaid customers was 50 000 Coopers Lybrand estimated 160,000 - 220,000 subscribers by the year 2002 M-Net Communications Technologies CE Ian Wilkinson calculated a potential base of 300,000 - 500,000 subscribers by 2004 The ultimate disruption In 2004 Africa added almost 15 million new mobile cellular subscribers to its subscriber base; Equivalent to the total number of (fixed and mobile) telephone subscribers on the continent in 1996, just eight years earlier 1; Only 8% of people in Africa use a mobile phone but 52% of the population in low income countries as a whole live in areas with wireless reception 2; This difference fuels the expectation that growth will continue at rapid rates, with some analysts predicting that there will be close to 200 million mobile subscribers in Africa by 20103. Relative to mobile phones, internet usage is low: outside of South Africa, barely 1% of Africans access the internet. Why is GSM so successful in Africa1? GSM